Category: IPOs

Is Weak IPO Market the Canary in the Coal Mine?

If the stock market is so healthy then why is the IPO market absolutely dead?  This is a question the WSJ addresses with IPOs off to their slowest start since the first quarter of 2009, in terms of deals and dollars raised.

“Either the IPO market is going to pick up, or the stock market is going to pull back, but it’s hard to envision both conditions peacefully coexisting,” said Jack Ablin, chief investment officer at BMO Private Bank.

In Q1 2016, there were only nine deals, raising a combined $1.2 billion.  This was the smallest since two IPOs combined for $890 million in the first quarter of 2009.

Off the nine deals, 3 are blank-check companies.  5 of the other 6 are higher, with Editas Medicine (NASDAQ: EDIT) leading the way with a 119% gain from its IPO price.